Personal Income in New Jersey Showing Slow Growth

personal income growth-01More evidence of New Jersey’s slow – even decelerating – economic recovery comes in the form of a new report from the Bureau of Economic Analysis at the United States Department of Commerce. Personal income in the Garden State grew at a slower rate last year than it did nationwide, and New Jersey’s growth of 2.2 percent was the lowest rate the state had seen in three years, down from 2.8 percent the previous year and 4.0 percent in 2011.

Nationally, personal income grew by 2.6 percent, reflecting a 1.6 percentage point decrease from the previous year – a drop the report chalked up to the expiration of a “payroll tax holiday” which had reduced employee contributions for social security, as well as high-income taxpayers reporting capital gains in 2012 to avoid paying higher rates that took effect in 2013.

In New Jersey’s information and public sectors, workers fared the worst. Information workers and public-sector employees (federal, state and local) were the only groups in New Jersey with negative personal income growth rates in 2013.

New Jersey industries with the largest percentage growth in personal income were forestry, fishing, farming, construction and management sectors.

Even if the Garden State’s personal income growth rate was below average in 2013, New Jersey is still near the top for overall income, ranking fourth in per-capita income (down from third the previous year). New Jersey’s growth rate relative to other states also improved this year, jumping to 33rd from 38th.

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